Amazon's Jeff Bezos, Warren Buffett, JPMorgan starting healthcare company

Amazon, Berkshire Hathaway and JPMorgan Chase & Co. to partner on US employee healthcare

Many others have tried this kind of thing.

Brian Gragnolati, CEO of Atlantic Health System and chair-elect of the American Hospital Association, said the announcement did not come as a surprise.

Later in the day, President Trump said in his State of the Union speech that reducing the price of prescription drugs would be one of his "greatest priorities", adding that the difference between USA prices and those in other countries was "very unfair".

And now the wellness credits are gone, and we've got "private exchanges" and "defined contribution" benefits. While the new company created by Amazon, Berkshire and JPMorgan would be for their United States staff only, this is the first big move by Amazon into the industry. In the future, the business giants claimed that the initiative could expand beyond the three companies and encompass a broader spectrum of people.

INSKEEP: I'm glad you mentioned their employees.

John Fanburg, attorney with Brach Eichler in Roseland, also said the announcement was not surprising.

Details about the new venture were sparse, and even an internal memo that Amazon sent employees on Tuesday was shorter than some Tweets we saw on the subject.

Most health care analysts were more skeptical. This is not the first initiative taken to provide solutions to the ongoing problem. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. Now, will that really move the needle on health care costs? "My gut tells me that it involves direct contracting with clinically integrated networks in their communities".

Amazon, Warren Buffett and JPMorgan are forming a new company to try to hold down the health-care costs of their employees, sending shares of health-care companies down sharply across the entire industry.

Amazon, Berkshire Hathaway and JPMorgan Chase & Co. have formed a healthcare joint venture that aims to cut costs, boost transparency and provide an overall better experience for their employees.

That "individual mandate" was a concession to the insurance companies to ensure they would have enough customers - especially young, healthy Americans who do not need medical care as often - to cover costs for those who need it more frequently, like the chronically sick or elderly. It says the new contracts should save its members who use them 15 percent a year in drug costs. PBMs use their size to wrangle rebates from drugmakers on behalf of employers, but the exact size of those rebates and the percentage they actually pass on to their clients are closely guarded secrets.

"The opportunity to potentially work with these organizations would be exactly what we would want".

A media representative for JPMorgan did not immediately return a request for more details. "The comments in the news release suggest that these leaders view this as an endeavor that is complex, challenging and thorny and that will take time to bear fruit".

"The ballooning costs of [health care] act as a hungry tapeworm on the American economy", Buffett said in a statement. "But we also do not accept it as inevitable", he said.

Jeff Bezos CEO Amazon said while speaking about the complexities of the healthcare system that we are entering into the challenge fully aware about the challenges and difficulties ahead of us. "Success is going to require talented experts, a beginner's mind, and a long-term orientation".

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